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Hartford: New England's Tortilla Chip Capital


February 01, 2013

HARTFORD Those tortilla chips you bought for the Super Bowl might be more local than you thought.

"If you walk into a Whole Foods and go down the chip aisle, just about all the products you see were made right here in Hartford," said Rick Stevens, operations manager at Severance Foods, Inc., the North End's almost 30-year-old snack factory. "But you wouldn't know that."

There's no "Made in Hartford" or made "by Severance Foods" stamped on the bags, which were turned out in record numbers in recent weeks to meet demand for Super Bowl parties.

To meet the need, the normal four, around-the-clock days of chip-making are augmented by another and that results in 8,000 cases, or 25 percent more, said Lief Dana, vice president of operations.

Today, you could well be eating Severance chips since the company sells to some of the nation's largest tortilla brands including all the Green Mountain Gringo chips sold east of the Rocky Mountains and all the Trader Joes tortilla chips for the eastern United States. It's also the national supplier for a number of Way Better Snacks chips. Newer brands like Late July Organic and Food Should Taste Good also come from the fryers at Severance Foods, where more than 80 people work.

Business has been good since tortilla chips moved from ethnic food to widely popular.

In 2011, shoppers plucked $145 million worth of tortilla chips off the shelves in the weeks around the big game, up from $136 million the year before, according to Nielsen, the global consumer information firm. In that same period, Nielsen reporter, tortilla chips grew to being almost a quarter of the snacks bought.

Severance has made gold out of the tortilla chip's rise in popularity.Though the company is comparatively small in the world of tortilla chip makers because the northeast's demand for chips pales in comparison to that of the south and the southwest, Severance is reporting sustained growth. Its sales hit $16 million last year, continuing a six-year trend of about 20 percent annual growth. Each week, the company chews through an average 80 tons of Texas and Kentucky corn, resulting in about 27.6 million tortilla chips, the company said.

At those levels, the company packages 1.44 billion chips yearly. Placed end-to-end they'd stretch twice around Earth and then some.

In 1985, though, when the tortilla-chip startup took off, the market for the snack was narrower.

Then "we'd make the product one, two days a week, then spend the rest of the time, the three of us, in our cars driving around Boston, Burlington, Vermont, Fairfield County, delivering stuff, knocking on the back doors of restaurants because distributors wouldn't talk to us," said Richard Stevens, the company's president and founding partner.

The three tortilla chip company founders Richard Stevens, John Grikis and Richard Dana used to work in Hartford at Heublein Food, whose products included A1 Steak Sauce, Ortega taco shells and Smirnoff vodka. After R.J. Reynolds, a tobacco company, bought Heublein in 1982 and planned to move the Hartford operations to Walnut Creek, Calif., the three men pooled their severance pay for startup capital. The company and its name were born.

They knew of equipment in two mothballed Ortega taco shell lines in California. So they made an offer. "We got them for 50 cents on the dollar," said Grikis. The equipment was loaded onto a flatbed and shipped to Hartford, and Severance was off the ground.

In the beginning, Severance focused on tortillas, not chips, with restaurants sales making up most of the company's business. Their big break, they said, came when Weight Watchers which made their meals in nearby Wethersfield came out with a frozen enchilada dinner and needed thousands of square tortillas a week. Severance landed the contract.

The company has since added making and bagging chips for other companies, while working on its own brand of tortilla chips called Pan de Oro, or bread of gold. Then and now, they've had a good hold on the regional market. Severance also is the only tortilla chip maker in New England; the closest competitors are in Virginia and Pennsylvania.

The wide reach, at least initially, caused a few issues for the company. For instance, when shipping over the continental divide to the West Coast, "the bags tended to explode," said Richard Stevens. Pressure changes made the cushioning air inside the bag a liability, so when shipping that way now, the company makes a bag with less air.

It wasn't that long ago that you wouldn't often find tortilla chips in grocery stores or nachos on restaurant menus. The salty snack took hold as a simple vehicle for salsa or queso, then increasingly as a palette for grains, herbs, and even fruits. The chip used to largely be about simplicity and tradition, a fact reflected in the relatively homogenous offerings in stores. Now it's about having the chip that no one else has.

"Our niche has been inclusion," said Grikis, the company's director, "including materials into the dough gives it a very unique seasoning, fried right into the chip."

Possibilities seen and tried by chip companies include rice, beans, varieties of vegetables, lentils, hummus, low-carb and gluten-free recipes, cranberries, raisins, brined jalapenos, olives, lime seasoning and hundreds of combinations of grains and herbs. For Severance, Rick Stevens once crafted a beer chip, made with hops instead of beer because the plant is gluten-free. "We met with a couple breweries who told us what types would be good," he said.

Taste-testers though had a tough time swallowing the innovation, though. Many said it was the first time they had to spit out a sample. "It tasted like chewing on a nickel," said Richard Stevens.

"We learned that hops are made for beer and not for a food item," said Rick Stevens, adding that he hasn't given up on the idea just yet.

The shift from chip as salsa vehicle to chip as a taste statement began around 2005, and now chip companies regularly call Severance to take a pulse for what they see in the industry. More than just the impressive array of ingredients, tortilla chips like many foods are becoming a pedestal for sustainability issues. It started long ago with kosher labeling at Severance, then organic and gluten-free. The next frontier is marking products that use non-genetically modified ingredients.

The market is also looking more local, creating an expansion opportunity for Pan de Oro, the company's brand of tortilla chips. Distributors and stores lined up. An artist refreshed the bag's design. But there was still a question.

"Our thinking was, we have all these great customers, do we want to do our own and compete with them?" said Richard Stevens.

Instead of taking on the world or even national market, Pan de Oro's marketing will focus on the Northeast to avoid having to butt heads with their existing customers. The chips will come in five styles traditional, multigrain, garlic herb, sesame, and red, white and blue. For now, the chips are for sale locally, and at Severance's facility on Main Street where they are sold at $15 for a case of 12 bags.

Courant staff writer Matthew Sturdevant contributed to this story.

Reprinted with permission of the Hartford Courant. To view other stories on this topic, search the Hartford Courant Archives at http://www.courant.com/archives.
| Last update: September 25, 2012 |
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